Which of the Following Statements Regarding a Foreign Person's U

question 23

Multiple Choice

Which of the following statements regarding a foreign person's U.S.tax consequences is true?

• A)Foreign persons are potentially subject to U.S.withholding tax on U.S.-source investment income.
• B)Foreign individuals may be subject to U.S.income tax but foreign corporations are never subject to U.S.income tax.
• C)Foreign persons are only subject to U.S.income or withholding tax if engaged in a U.S.trade or business.
• D)Foreign persons must be physically present in the United States before any U.S.-source income is subject to U.S.income or withholding tax.

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Definitions:

Collusion

A secret or illegal cooperation or conspiracy, especially between businesses to limit competition and raise prices.

Marginal Cost

The financial outlay involved in producing a supplementary unit of a good or service.

Crude Oil

A naturally occurring, unrefined petroleum product composed of hydrocarbon deposits and other organic materials, used as a primary energy source.

Industry Output

The total production of goods and services produced by a specific sector of the economy over a given period.